Final Results for 2006/2007
MS International PLC
22 June 2007
Chairman's Statement
Results and review
It is a pleasure to report a further year of good progress and profitable growth
for the Group. Revenue, pre-tax profit, earnings per share, cash at bank, order
intake and the forward order book all closed higher than the previous year.
For the year ended 28 April 2007, the Group profit before taxation amounted to
£4.40m (2006-£3.81m) on revenue of £47.88m (2006-£44.44m). Earnings per share
were 18.2p (2006-15.0p).
The balance sheet is stronger and net cash at the year-end had risen to £7.61m
(2006-£5.91m).
The Group's progressive trend of achieving an enhanced performance is a direct
result of major internal effort and the successful implementation of strategic
decisions taken over recent years. Product research and development in defence
has been vitally important in attaining our success, whereas in the other two
divisions, improved facilities and the commissioning of new advanced high
capacity process plant and equipment made the distinction. These initiatives,
when supported by superior contract execution and project management, have
yielded a substantial gain in our commercial and financial accomplishments.
Conversely, implementing the programmes resulted in a degree of inevitable short
term disruption to ongoing production. That said, our instinctively cautious but
optimistic approach to managing our operations enabled us to maintain a
reasonably balanced and satisfactory outcome in all respects.
In the defence division, work progresses effectively on both UK Royal Navy and
foreign naval projects. Recent success in booking a number of new equipment
orders for overseas navies' ship building programmes has added clarity to our
prospective longer term revenue visibility. Advanced technologies introduced in
the forgings division have been instrumental in creating positive commercial
benefits, as we expand our market share. The petrol station forecourt
construction joint-venture business traded to a high standard, despite revenue
being lower than last year, influenced largely by start-up delays in clients'
construction programmes.
The Group's phased forward order book has enjoyed a significant boost recently
and is now some 24% higher than that recorded at the corresponding time last
year, reflecting our strengthening position in the current buoyant markets we
serve.
Outlook
As we enter the new financial year, the Group is well positioned. Currently, our
global markets are reasonably optimistic about the short to medium term outlook
and we are encouraged by the high level of new business prospects presently
emerging. Providing this upbeat trend continues into the foreseeable future, we
will endeavour to take advantage of opportunities as they arise.
The importance of personal commitment and investment in the businesses cannot be
ignored. It is essential that we preserve our established agile approach of
adapting rapidly to the ever changing expectations of our customers, by being
technologically innovative and simultaneously upgrading internal processes and
streamlining production. These features played a central role in our
achievements during 2006/7 and are critical to our future success. All things
being equal, we are determined to stretch them into 2007/8.
The Board recommends the payment of a final dividend of 3.00p (2006-2.20p)
making a total for the year of 3.60p (2006-2.78p).
Michael Bell
22 June, 2007
Group Income Statement
For the 52 weeks ended 28th April, 2007
Restated
2007 2006
Total Total
£000 £000
Revenue 47,878 44,435
Cost of sales (35,795) (32,936)
Gross profit 12,083 11,499
Distribution costs (1,970) (1,961)
Administrative expenses (6,243) (5,845)
(8,213) (7,806)
Group trading profit 3,870 3,693
Finance revenue 102 11
Finance costs (7) (40)
Other finance revenue - pension 435 142
530 113
Profit before taxation 4,400 3,806
Taxation (1,384) (1,309)
Profit for the period attributable to equity holders of the 3,016 2,497
parent
Earnings per share: basic 18.2p 15.0p
diluted 17.5p 14.3p
Statement of Recognised Income and Expense
For the 52 weeks ended 28th April, 2007 Group Company
Restated Restated
2007 2006 2007 2006
Total Total Total Total
£000 £000 £000 £000
Revaluation surplus on land and buildings - 3,396 - 3,396
Deferred taxation on revaluation surplus on land and buildings - (454) - (454)
Actuarial gains on defined benefit pension scheme 1,550 3,726 1,550 3,726
Deferred taxation on actuarial gains on defined benefit pension (465) (1,118) (465) (1,118)
scheme
Currency translation differences on foreign investments (58) 85 (55) 91
Net income recognised directly in equity 1,027 5,635 1,030 5,641
Profit attributable to equity holders of the parent 3,016 2,497 2,687 2,139
Total recognised income and expense for the period attributable 4,043 8,132 3,717 7,780
to equity holders of the parent
The financial information set out above does not constitute the Company's
statutory accounts for the periods ended 28th April, 2007 or 29th April, 2006
but is derived from those accounts. Statutory accounts for 2006 have been
delivered to the Registrar of Companies, and those for 2007 will be delivered
following the Company's Annual General Meeting. The auditors have reported on
those accounts; their reports were unqualified and did not contain a statement
under section 237 (2) or (3) of the Companies Act 1985.
The financial information has been prepared using the proportionate method of
accounting for the interest of the Group in Global-MSI plc. The figures for the
52 weeks ended 29th April, 2006 have been restated accordingly. It is the
opinion of the directors that the proportionate method of accounting rather than
the equity method better reflects the substance and economic reality of our
interest in the joint venture. Disclosing the Group's share of the assets,
liabilities, revenue and costs of the joint venture provides a more complete
understanding of the performance and position of the Group. As a result of the
changes, the balance sheet includes the Group's share of the joint venture's
assets and liabilities and the income statement includes its share of the income
and expenses but the restatement does not affect the previously reported figures
for profit before taxation, earnings per share or equity.
The earnings per share is calculated by dividing the profit after taxation of
£3,016,000 (2006 - £2,497,000) by the weighted average of 16,557,004 (2006 -
16,639,123) shares in issue in the year.
Copies of this announcement are available from the Company's registered office
at MS INTERNATIONAL plc, Balby Carr Bank, Doncaster, DN4 8DH, England. The full
Annual Report and Accounts will be posted to shareholders shortly and will be
delivered to the Registrar of Companies after it has been laid before the
Company in general meeting.
Dividend warrants will be posted on 31st August, 2007 to members on the books of
the Company at 3rd August, 2007.
Balance Sheets
At 28th April, 2007
Group Company
Restated
2007 2006 2007 2006
£'000 £'000 £'000 £'000
ASSETS
Non-current assets
Property, plant and equipment 14,676 12,368 13,837 11,814
Intangible assets 253 296 253 296
Investments in subsidiaries - - 6,869 6,869
Investment in joint venture - - 50 50
Defined benefit pension asset 894 - 894 -
15,823 12,664 21,903 19,029
Current assets
Inventories 4,327 4,176 3,141 2,710
Trade and other receivables 7,288 7,971 6,874 8,435
Prepayments 2,109 1,863 2,025 1,781
Cash 7,608 5,907 6,884 5,212
21,332 19,917 18,924 18,138
TOTAL ASSETS 37,155 32,581 40,827 37,167
EQUITY AND LIABILITIES
Equity
Issued capital 1,871 1,871 1,871 1,871
Capital redemption reserve 870 870 870 870
Other reserves 1,544 1,544 1,544 1,544
Revaluation reserve 2,942 2,942 2,942 2,942
Special reserve 1,629 1,629 1,629 1,629
Foreign exchange reserve (151) (93) (111) (56)
Own shares (738) (738) (738) (738)
Retained earnings 8,719 5,082 7,110 3,802
16,686 13,107 15,117 11,864
Non-current liabilities
Defined benefit pension liability - 1,171 - 1,171
Finance leases 4 4 - -
Provisions 48 114 48 114
Government grants 28 41 28 41
Deferred income tax liability 1,779 927 1,759 922
1,859 2,257 1,835 2,248
Current liabilities
Trade and other payables 18,060 16,343 23,423 22,322
Finance leases 7 2 - -
Provisions 65 65 65 65
Government grants 13 13 13 13
Income tax payable 465 794 374 655
18,610 17,217 23,875 23,055
TOTAL EQUITY AND LIABILITIES 37,155 32,581 40,827 37,167
Cash Flow Statements
For the 52 weeks ended 28th April, 2007 Group Company
Restated
2007 2006 2007 2006
£000 £000 £000 £000
Trading profit 3,870 3,693 3,420 3,053
Adjustments to reconcile trading profit to net cash in flows from operating
activities
Depreciation charge 1,127 1,254 924 1,054
Amortisation charge 128 69 128 69
Diminution in value of subsidiaries - - - (97)
Foreign exchange (losses)/gains (58) 85 (55) 91
RSA grant release (13) (11) (13) (11)
Pension charge 528 486 528 486
Decrease in inventories 576 2,323 296 2,114
Decrease/(increase) in receivables 683 (1,815) 1,561 (2,151)
Increase in prepayments (246) (1,483) (244) (1,462)
Increase/(decrease) in payables 1,061 173 572 670
(Decrease)/increase in progress payments (68) 3,991 (198) 4,036
Provisions utilised (66) (64) (66) (64)
Pension fund payments (608) (486) (608) (486)
Cash generated from operating activities 6,914 8,215 6,245 7,302
Interest received/(paid) 95 (29) 78 (25)
Taxation paid (1,329) (1,177) (1,155) (940)
Net cash flow from operating activities 5,680 7,009 5,168 6,337
Investing activities
Purchase of property , plant and equipment (3,613) (1,733) (3,053) (1,446)
Purchase of intangible asset (85) (42) (85) (42)
Sale of property, plant and equipment 178 115 106 93
Dividends received from joint venture - - - 175
Net cash used in investing activities (3,520) (1,660) (3,032) (1,220)
Financing activities
Purchase of own shares - (207) - (207)
Dividends paid (464) (372) (464) (372)
Repayment of bank loans - (167) - (167)
New finance leases 12 - - -
Repayments of capital element of finance leases (7) (81) - (79)
Net cash flow used in financing activities (459) (827) (464) (825)
Movement in cash and cash equivalents 1,701 4,522 1,672 4,292
Opening cash and cash equivalents 5,907 1,385 5,212 920
Closing cash and cash equivalents 7,608 5,907 6,884 5,212
Reconciliation of movement in equity
Capital Foreign
Issued redemption Other Revaluation Special exchange Own Retained
capital reserve reserves reserve reserves reserves Shares earnings Total
£000 £000 £000 £000 £000 £000 £000 £000 £000
(a) Group
At 30th April, 2005 1,886 855 1,544 - 1,629 (178) (738) 556 5,554
Total recognised
income and - - - 2,942 - 85 - 5,105 8,132
expense for the year
Dividends paid - - - - - - - (372) (372)
Repurchase of shares (15) 15 - - - - - (207) (207)
At 29th April, 2006 1,871 870 1,544 2,942 1,629 (93) (738) 5,082 13,107
Total recognised income - - - - - (58) - 4,101 4,043
and expense for the year
Dividends paid - - - - - - - (464) (464)
At 28th April, 2007 1,871 870 1,544 2,942 1,629 (151) (738) 8,719 16,686
(b) Company
At 30th April, 2005 1,886 855 1,544 - 1,629 (147) (738) (366) 4,663
Total recognised income - - - 2,942 - 91 - 4,747 7,780
and expense for the year
Dividends paid - - - - - - - (372) (372)
Repurchase of shares (15) 15 - - - - - (207) (207)
At 29th April, 2006 1,871 870 1,544 2,942 1,629 (56) (738) 3,802 11,864
Total recognised income - - - - - (55) - 3,772 3,717
and expense for the year
Dividends paid - - - - - - - (464) (464)
At 28th April, 2007 1,871 870 1,544 2,942 1,629 (111) (738) 7,110 15,117
(1) Share Capital
The balance classified as share capital includes the nominal value on issue
of the Company's equity share capital, comprising 10p Ordinary shares.
(2) Capital redemption reserve
The balance classified as capital redemption reserve represents the nominal
value of issued share capital of the Company, repurchased
(3) Other reserves
This is the revaluation reserve previously arising under UK GAAP which is
now part of non-distributable retained reserves.
(4) Revaluation reserve
The asset revaluation reserve is used to record increases in the fair value
of land and buildings and decreases to the extent that such decrease
relates to an increase on the same assets previously recognised in equity.
(5) Special reserve
The balance classified as special reserve represents the share premium on
the issue of the Company's equity share capital.
(6) Foreign exchange reserve
The foreign currency translation reserve is used to record exchange
differences arising from the translation of the financial statements of
foreign subsidiaries. It is also used to record the effect of hedging net
investments in foreign operations.
(7) During 1991 the Company established an Employee Share Ownership Trust
('ESOT'). The trustee of the ESOT is Appleby Trust (Jersey) Ltd, an
independent company registered in Jersey. The ESOT provides for the issue
of options over Ordinary shares in the Company to Group employees,
including executive directors, at the discretion of the Remuneration
Committee.
The trust has purchased an aggregate 2,154,069 Ordinary shares, which
represents 11.4% of the issued share capital of the Company at an aggregate
cost of £738,000. The market value of the shares at 28th April, 2007 was
£3,425,000. The Company has made payments of £Nil (2006 - £Nil) into the
ESOT bank accounts during the period. No options over the shares (2006 -
Nil) have been granted during the period. Details of the outstanding share
options are included in the Directors' Remuneration Report.
The assets, liabilities, income and costs of the ESOT have been
incorporated into the Company's financial statements. Total ESOT costs
charged to the profit and loss account in the period amounts to £5,000
(2006 - £Nil). During the period no share options were exercised (2006 -
£Nil) and no additional shares purchased (2006 - Nil).
This information is provided by RNS
The company news service from the London Stock Exchange
Wednesday, 22nd January 2025
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